TECHNOLOGICAL INSTITUTE OF THE PHILIPPINES

1336 Arlegui St., Quiapo Manila

CEP 423 TRANSPORTATION ENGINEERING

THE EFFECTS OF P.N.R. CHARTER EXTENSION

CHAPTER I
INTRODUCTION
A. BACKGROUND OF THE STUDY
The charter of the Philippine National Railways will expire on June 20. If
its corporate life is not extended, PNR will be dissolved, any stoppage of the rail
service will be of huge inconvenience for our commuting public, especially for our
countrymen who hail from provinces and who have to travel to Metro Manila on a
daily basis.
PNR charter extension primary reforms are: Improve the efficiency of its
existing Metro Manila Commuter Line and expand the line northward to Malolos.
Automate the present fare collection system. Revive the mainline south to Bicol
and extend the south line onwards to Sorsogon. Introduce freight service for
goods via the existing at-grade PNR tracks. Improve the utilization of PNR real
estate assets. Implement the highest standards of governance in its financial and
management operations. Those reform commitments will hopefully reduce the
yearly subsidy provided by the government for PNRs operations.
PNR should consider to improve its operations and increase its
contribution to national economic development by: Conducting a full-blown study
for the overall PNR railway modernization plan, looking into the viability of
extending the existing PNR lines to routes that are possible sources of increases
ridership. Determining most advantageous or appropriate rail transit technology
for the PNR lines. Utilizing of improved ticketing, safety, and security systems.
Settling all its obligations to positively contribute to the nation economy.
Continuing efforts in venturing into other means of increasing its revenues to help
cover outstanding obligations. And lastly, better managing its operation.

B. STATEMENT OF THE PURPOSE

Can modernization of the PNR alleviate the problems in transportation

system?

Do this rehabilitation project helps to continue the economic development our

country?

Can the government sustain and maintain the progress of this particular
project?

C. SIGNIFICANCE OF THE STUDY

The findings of this study will rebound to the benefit of society considering
that PNR plays an important role in our community today. The greater demand of
people who wants to travel using rail transit justifies the need for more safe and
efficient transportation system. By understanding the effect of this charter
extension we can definitely tell the future of our transportation industry. Moreover,
this research will provide recommendations on how to evaluate the performance
of a certain agency in accordance to transportation system and this will be also
helpful to government because it can serve as a future reference for their
upcoming rail transportation projects. And finally, this research will educate the
people in deciding whether the government is really fulfilling its responsibility to
the community or is just showing off to promote its administration.
D. SCOPE AND LIMITATION

The scope of this case study is the development of the operations and
facilities PNR. The study takes the following area into consideration: The
amendments on the former and latter PNR Charter. The PNR track records of the
former charter. And the allotted budget in the previous operation of the PNR.
The study is bound within the limits of Bicol Commuter Service, the Metro
Commuter Line, and the expansion of PNR service throughout the Luzon.

CHAPTER II
THEORETICAL FRAMEWORK
This chapter presents the related literature and studies after the thorough and
in-depth search done by the researchers. This will also present the synthesis of
the art, theoretical and conceptual framework to fully understand the research to
be done and lastly the definition of terms for better comprehension of the study.
A. REVIEW OF RELATED LITERATURE AND STUDIES
In March 2012, India announced its biggest railway budget in history to tackle
network capacity and safety issues. Looking into some of the most significant
Indian railway projects up to 2017, Railway-Technology asks whether the
measures will be enough to modernize a network which is still one of the most
dangerous in the world.
India's 64,000km rail system, the fourth largest in the world, transports more
than ten billion passengers and 1,050 million tons of freight every year. But the
network is perhaps best known for its capacity and safety issues, which make it
one of the most dangerous globally.
The Indian Government has been striving to tackle the problem and has
injected billions of dollars into new projects and tracks. In its March 2012 railway
budget, it pledged to invest $147bn into major projects during the next five years,
in an effort to finally catch up with its neighboring.
The main focus of the investment to 2017 is on improving tracks, bridges,
signaling, rolling stock and stations throughout the country. In addition, 700km of
new railway tracks are to be added to the network to link some of India's more
remote regions with the rest of the country, making it one of the biggest
investments in India's long history of railway transport.
In the next five years, India will set the whole railway industry towards one
goal: better, bigger, faster and safer rail links which cater to the needs of the

country's prospering middle class. In an effort to gain more economic and

geographical mobility, the government is planning to spend vast amounts of
money to overhaul its creaky network.
In total, it has sanctioned ten new electrification projects and 17 new gauge
conversion projects in its Railway Budget 2012-2013 alone. In addition to the
hundreds of kilometres of new tracks, it will also upgrade stations and add a
number of new express and passenger trains.
One of the biggest expansion projects currently under construction is
theKashmir railway, officially called the Jammu-Udhampur-Katra-QazigundBaramulla link (JUSBRL). At the beginning of 2012, the government announced a
cash injection of $3.5bn, with which the originally estimated cost of $13bn will
most likely be exceeded. The project, which is due for completion in 2017,
already received National Project Status in 2002 but has encountered substantial
engineering challenges over the years, in particular through the Pir Panjal
mountains area, where an 11km tunnelling section took more than six years to
complete.
A massive part of India's railway investment goes into its densely populated
cities, in particular the capital New Delhi. The approval of a new $327 monorail
extension to the overcrowded Delhi Metro was announced in January 2012. The
new line will have 12 stations and interchanges with three existing metro lines
and is expected to come online by 2017, serving about 150,000 passengers a
day.
In Mumbai on the other hand, the Mumbai Metropolitan Region Development
Authority (MMRDA) set aside $244m out of the $1bn yearly budget for the
development of the metro rail and monorail, with $176m going into a new
monorail project. Apart from that, the authority has also decided to invest $58m
for the Mumbai Urban Transport Project-II (MUTP-II) for the improvement of the
suburban rail system.
Another major mass rapid transit system is being constructed for the city of
Hyderabad, scheduled to become operational in 2017. At the beginning of May
2012, officials announced that the first phase is likely to be completed in three
years time.

It is one of the world's largest public private partnership (PPP) projects in the
metro sector, involving 71.16km of elevated metro rail lines in three corridors,
with 65 stations crisscrossing throughout the capital of the state of Andhra
Pradesh.
The Indian Government has most definitely realized the need to upgrade its
railway network to bring it in line with its neighboring countries. But the officials
also know that track connection with countries such as Bangladesh, Pakistan,
Nepal and China will be vital.

In April 2012, Indian Railways therefore announced that it will take part in the
80,900km Trans-Asian Railway Network (TARN), which soon could connect 28
countries between Europe and south-east Asia. For India, taking part in the
project is essential for its strategic development and will boost economic
activities in the years ahead.
Indian Railways will initially invest $580m to link about 97km of new rail
connections between Jiribam and Tupul (Manipur) in the first phase of the
project.
The entire project, which is being considered by the United Nations Economics
and Social Commission for Asia and the Pacific (UNESCAP) under the Asian
Land Infrastructure Development Project, is expected to be completed by 2025.
The importance of building transnational links with other countries was
also highlighted by former Railway Minister Dinesh Trivedi during his budget
announcement on 14 March 2012, claiming that this approach will significantly
develop relations with neighboring countries to "improve bilateral ties" and help to
establish connectivity with inaccessible areas.
But while India has shown the hunger to implement even the most
ambitious railway projects, its authorities sometimes fail to mirror this in their
approach to rail investments from private and foreign investments. Currently,
public-private partnerships only represent four percent of investments in India's
railway sector, even though the industry has demanded clear guidelines to attract
private investments for many years.
"Improved project implementation, streamlined and time-bound approval
processes, providing terms in projects that will allow investors to gain

'reasonable' returns on capital, and more efficient vendor management are some
of the areas that can be addressed by the Indian Railways to ensure the growth
and sustainability of the sector," said Confederation of Indian Industry (CII)
director general Chandrajit Banerjee just days before the budget announcement
in March.
Opening up the sector for private investment however requires a new mindset
from India's politicians. But until now, railway is still treated as the crowdpleasing, super-cheap state transport, as some experts believe.
"There is a lot of scope to come in and a huge amount of investment can
come in from the private sector but the railways have to open up. Till now the
Indian railways had been much closed," Hermant Kanoria, Kolkata-based Srei

Infrastructure chairman and managing director, told news agency Reuters in

March, pointing out the much-needed change in the sector
Perhaps the biggest problem has however been highlighted by the
resignation of Railway Minister Dinesh Trivedi, only days after his budget
announcement in mid-March. In his budget speech, he pledged to increase
passenger rail fares for the first time in eight years in a move to improve network
efficiency and safety. His party however protested against the decision, forcing
him to quit and make way for Mukul Roy.
Commenting on his decision, Trivedi said: "I'm worried about safety. I did
what I did because of safety." All this came on the back of the publication of a
report by a government-appointed panel that reviewed the country's railway
safety after some major accidents in recent years.
The results were shocking: every year, around 15,000 people die
somewhere along India's extensive rail tracks, usually slum-dwellers and poor
villagers who live near the lines or passengers who fall off overcrowded
commuter trains. Mumbai's suburban rail network alone accounts for as many as
6,000 deaths a year.
The panel said that although these deaths are not from train collisions,
they cannot be ignored by railway authorities and called on the government to
invest $20bn over the next five years to upgrade technology and infrastructure.

This should include safe coaches, anti-collision devices, advance warning

systems and the strengthening of ageing tracks and rail bridges.
Indian Institute of Management professor and transport and infrastructure
expert G Raghuram, a member of the panel, suggested several measures to
address the issue: "There are various solutions possible - better fencing, more
opportunities to cross the tracks through overpass bridges. In suburban areas, at
least, there is no reason why Indian Railways cannot just floodlight the entire
railway track," he said.
He added that modernizing the network will also help reduce train
accidents. "In terms of international benching, and given the technologies and
systems that are available, the Indian railways can do a lot more Railways have
just to move, take a quantum jump in terms of the systems and technologies they
need to adopt."
However, without real governmental support to even impose the simplest
safety measures, improving some of these death traps still seems a long way off.
Trivedi

most definitely has paid a high price. It also shows that without the right political
environment even the biggest railway investments seem to be money thrown
down the drain.
In researcher point of view, this case of Indias investment for railway
development can relate in the topic discussed in this research paper. Just like
India, the Philippines National Railway will set the whole railway industry towards
one goal: better, bigger, faster and safer rail links which cater to the needs of the
country's prospering middle class. In an effort to gain more economic and
geographical mobility, the government is planning to spend vast amounts of
money to overhaul its creaky network.
B. CONCEPTUAL FRAMEWORK
The researchers wants to test the Cost-Benefit Analysis Process. The
Cost-Benefit Analysis is a process use in quantifying costs and benefits of a
decision, program, or project (over a certain period of time), and those of its

alternatives (within the same period), in order to have a single scale

comparison of unbiased evaluation. In cost benefit analysis decisions are
analyzed. The benefits of a given situation are summed and then cost
associated with taking that action are subtracted.
The pursuit for understanding was done through the following process:
data collection through the use of questionnaires and interviews; data
analysis, clarifying statistical statements; and data interpretation, findings,
conclusions, and recommendations.
The output of this pursuit was proposed implementing guidelines for
monetary and non-monetary benefits of the Philippine National Railway.

INTERPRETATION

DIRECT
APPLICATIONS
:
Product
development
and
improvement
Strategic
Planning
Public policy
making
Marketing

IMPACT
ASSESSMENT
GOAL AND
SCOPE
DEFINITION
INVENTORY
ANALYSIS

Other

C. DEFENITION OF VARIABLES
Charter - a written grant by a country's legislative or sovereign power, by
which an institution such as a company, college, or city is created and its
rights and privileges defined.
Common Railway - From the first moments that steam engines started
rolling across the fields of England, standard configuration of railway began
spreading across the world.
Congestion - too crowded or blocked.
Cost-Benefit Analysis - a process use in quantifying costs and benefits of a
decision, program, or project (over a certain period of time), and those of its
alternatives (within the same period), in order to have a single scale
comparison of unbiased evaluation.
Economic Evaluation - is to evaluate alternative strategies stage
construction or full construction. There are different methods of economic
evaluation, the cost benefit ratio, net present value method, and internal rate
of return method.
Electrified Railway - is a locomotive powered by electricity from overhead
lines, a third rail or on-board energy storage such as a battery or fuel cell.
Freight - A charge paid for carriage or transportation of goods by air, land, or
sea.
Freight Operations - Freight or cargo trains are loaded and unloaded in
intermodal terminals and at customer locations.
Intelligent Transportation Systems (ITS) - are advanced applications
which, without embodying intelligence as such, aim to provide innovative

services relating to different modes of transport and traffic management and

enable

various users to be better informed and make safer, more coordinated, and
'smarter' use of transportation.
High-speed Rail - is a type of rail transport that operates significantly faster
than traditional rail traffic, using an integrated system of specialized rolling
stock and dedicated tracks.
Maintenance of Way Operations - The presence of a work train on a given
section of track will temporarily decrease the capacity of the route. The
normal method in such operations is to cease other traffic altogether during
the track 'occupation'.
MMCL Metro Manila Commuters Line
Monorail - railways that are not using maglev design are today most often
used in urban environments, with slow trains and trams that transport usually
only people.
PNR Philippines National Railways is a state-owned railway company in
the Philippines, operating a single line of track on Luzon.
PPP Public Private Partnership. An economic theory that estimates the
amount of adjustment needed on the exchange rate between countries in
order for the exchange to be equivalent to each currency's purchasing power.
Rail

System

line that is the commercial organization responsible for

operating a system of transportation for trainsthat pull passengers or freight.

Rail Tracks - a structure consisting of a pair of parallel lines of rails with their
crossties, on which a railroad train, trolley, or the like runs. a wheel rut.

Evidence, as a mark or a series of marks, that something has passed.

Usually, tracks. Footprints or other marks left by an animal, person, or vehicle.

Rail Transport - is a means of conveyance of passengers and goods, by way

of wheeled vehicles running on rails. It is also commonly referred to as train
transport. In contrast to road transport, where vehicles run on a prepared flat
surface, rail vehicles are also directionally guided by the tracks on which they
run.
Railway - a permanent track composed of a line of parallel metal rails fixed to
sleepers, for transport of passengers and goods in trains.
Signaling - is a system used to safely direct railway traffic in order to
prevent trains from colliding. Trains move on fixed rails so they are uniquely
susceptible to collision; the weight of trains and momentum makes it difficult
to stop before reaching the impending obstacle.
TARN - is a project to create an integrated freight railway network across
Europe and Asia. The TAR is a project of the United Nations Economic and
Social Commission for Asia and the Pacific (UNESCAP).
Traffic Engineering - focuses into the techniques on how to achieve a safe
and efficient movement of people and goods on the roadways. It is divided into
different parts, namely: transportation engineering, pavement engineering,
bicycle transportation engineering, highway engineering, urban planning, and
human factors engineering.
Transportation

System

the land, water, and air routes and transportation

movement

of US forces and their

All

assets

engaged in the

supplies

across the

range ofmilitary operations, involving both mature and immature theaters and
atthe strategic, operational, and tactical levels of war.

UNESCAP - The Economic and Social Commission for Asia and the
Pacific (UNESCAP or ESCAP), located in Bangkok, Thailand, is one of the
five regional commissions of the United Nations Economic and Social
Council,

under

headquarters.

the

administrative

direction

of

the

United

Nations

CHAPTER III
METHODOLOGY
This study was aimed at determining the possibility of re-amendment of the
PNR charter and whether the said amendment is sustainable, attainable, and
long-term. In this Chapter, the researchers attempted to describe the research
methodology used throughout the conduct of the study. At the same time, it is
also in this Chapter that presentation was made on how sample was selected as
it endeavored to outline the procedure used in designing the instrument and how
it gathered and collected the necessary data.
A. RESEARCH DESIGN
This study employed a combination of both descriptive qualitative and
quantitative research design. A researcher-made survey was used to
determine the extent of the stakeholders knowledge about the said charter
and the PNR operations itself.
B. RESEARCH LOCALE
This study was undertaken in the metropolis. Under uncontrollable
circumstances, the study was conducted specifically among the students from
the Technological Institute of the Philippines, Manila and the Technological
University of the Philippines, Manila.
C. SAMPLES AND SAMPLING TECHNIQUE USED
In order to approximate the actual number of respondents the researcher
adopted the Fraenkel and Wallens (2007) idea in the determination of the

appropriate sample size needed in this particular study. Fraenkel and

Wallens

(2007) suggested that for a descriptive design, ten (10) to twenty (20) percent
of the population is enough to constitute a sample. For a population of less
than 100, however, total enumeration is recommended, and if the population
is about 500, sample will range up to 50%.
D. INSTRUMENTATION
The instrument was composed of set of questions and statements
pertaining to the impacts of the amendment of the PNR, answerable with yes
or no. It was assumed that from the series of questions and statements that
were answered by the respondents that the PNR charter
E. PROCEDURE
The survey consisted of five (5) questions, in which the respondents have
to readily answer with a simple Yes or a No.
1. Do you use/have used PNR as a means of transportation?
2. Did you know that the charter for PNR has expired on June 20?
3. Is the fare affordable for students like you?
4. Does PNR help answer the congestion problem in the country?
5. If ever there will be a price hike in the PNR usual fare, would you still
utilize the train?

F. STATISTICAL ANALYSIS OF THE DATA

Descriptive statistics such as frequency counts and percentages were used to
analyze the data specifically in determining the answers of the respondents given
the survey.

CHAPTER IV
RESULT AND DISCUSSION
A. RESULTS

The group conducted a survey regarding the knowledge and the

usefulness of the PNR to the Filipino commuters. Twenty random people are
requested to answer questionnaires in the previous weeks. Only a three out of
the twenty commuters included in the survey use the PNR as their mode of
transportation, while the rest do not use it as their mode of transport. Whether the
commuters know that the PNRs charter has been extended, all of them
responded that they were not aware. All of them also agreed that the PNRs fair
is reasonable and affordable. When asked if the PNR could be one of the ways
to lessen the traffic, only four among the commuters answered no. Lastly, if the
PNRs fair will increase, only seven of them said they will not ride the PNR again.
B. DISCUSSION
The PNR is one of the modes of transportation in the Philippines. It has
long been built in the country and is still now being used and has been improved.
Routes are added and the stations and destinations were also developed. The
survey conducted aims to understand the knowledge and opinion of people
regarding the said topic. The results show that only a few of the commuters
asked use the PNR as their mode of transport. Also, only a few people are aware
of the extension of the charter of the PNR. Despite the low count of users
according to the survey, most of them still believe that the PNR helps in
lessening the grave condition of the traffic in the country, as it plays an important

option or mode in travelling. Also the users agreed that the fair of the train is
reasonable and affordable. As the PNR developed during the course of time, it
has also been made flexible as it connects bordering provinces in the country. All
in all, the survey results suggest that some of the commuters still consider the
benefits of the PNR up to this day.

C. GLOSSARY
Amendment - the act of changing for the better, improvement.
Baggage - personal belongings or large amount of objects that passengers
take with them on trips.
Bicol Commuter Service (BCS) - one of the two commuter services that
PNR provides but is currently unavailable.
Bicol Express Train - the train system used in trips going to Provincial
stations.
Charter - a document defining the formal organization of a corporate body;
organization
Commuter - One that travels regularly from one place to another.
Department of Transport and Communication (DOTC) - is the executive
department of the Philippine government responsible for the maintenance and
expansion

of

viable,

efficient,

and

dependable

transportation

and

communications systems as effective instruments for national recovery and

economic progress.
Derail - the cause of train to go off track due to accident

Government-Owned Railway - railway system where the government

manages the operations
Intercity Operation - the regular trips conducted throughout the stations
located on cities in the country.
Interprovincial Operations - trips formerly conducted wherein the travel to
stations on provinces.

Locomotives - rail transport vehicle that provides motive to trains

Metro South Commuter Service (MSCS) - the remaining active commuter
service the PNR offers.
Operations - the act or process of operating or functioning
Operators - are individuals assigned on operating a certain type of
mechanical system
Passenger- A person who travels in conveyance, such as a car or train.
PNR (Philippine National Railways) - is a state-owned railway company in
the Philippines, operating a single line of track on Luzon.
Railway - A track providing a runway for wheeled equipments
Routes - a way of travel from one place to another
Safety certification - are certifications provided by agencies to facilities when
they comply to guidelines.
Stations - designated loading and unloading locations.

Track structure - the physical element of a train track

Traffic - the passage of people and goods along routes of transportation
Train - A series of connected railroad cars pushed or pulled by one or more
locomotive
Train Coach - are parts of train that carries the passengers.

Transport Agencies - agencies designated for organizing transport systems

Transportation - A means of conveyance
Trip a journey
TV Rheinland - worldwide provider of technical and safety certification.
D. BIBLIOGRAPHY
https://www.google.com.ph/search?
q=derail&oq=derail&aqs=chrome..69i57j0l3.1354j0j4&client=msandroid-samsung&sourceid=chrome-mobile&ie=UTF8#safe=off&q=locomotive
http://www.pnr.gov.ph/index.php/about-contact-us/who-weare/corporate-profile
https://www.google.com.ph/search?
q=train+coach&oq=train+coach&aqs=chrome..69i57j0l3j69i60.4157
j0j4&client=ms-android-samsung&sourceid=chrome-mobile&ie=UTF8
https://www.google.com.ph/search?
q=tuv+pnr&oq=tuv+pnr&aqs=chrome..69i57.3119j0j4&client=msandroid-samsung&sourceid=chrome-mobile&ie=UTF8#safe=off&q=tuv+rheinland
http://www.pnr.gov.ph/index.php/news-media/press-releases/180-pnrsuspends-its-metro-manila-operations

http://dictionary.reference.com/browse/charter
https://en.wikipedia.org/wiki/Department_of_Transportation_and_Com
munications_(Philippines)
http://www.thefreedictionary.com/route

CHAPTER V
SUMMARY, CONCLUSION, AND RECOMMENDATION
A. SUMMARY
The main purpose of extending the charter of Philippine National Railways
is to: Improve the efficiency of its existing Metro Manila Commuter Line and
expand the line northward to Malolos. Automate the present fare collection
system. Revive the mainline south to Bicol and extend the south line onwards to
Sorsogon. Introduce freight service for goods via the existing at-grade PNR
tracks. Improve the utilization of PNR real estate assets. Implement the highest
standards of governance in its financial and management operations. Citing the
position of the National Economic Development Authority (NEDA) and PNR, it is
said that extending the PNR charter will yield economic benefits: It supports the
governments thrust in improving connectivity and efficiency among urban
centers and regional growth hubs. It offers the cheapest mode of transportation
to a wide geographic area, with fare amounting to P0.71 per kilometer as
compared to jeepneys and buses with P2 per kilometer. It is worth noting that
PNR has not increased its fare matrix in the last 20 years. Discontinuing the
PNR service will displace passengers who come from the lowest earning C and

D economic bracket of the population. The scope of this case study is the
development of the operations and facilities PNR. The study takes the following
area into consideration: The amendments on the former and latter PNR Charter.
The PNR track records of the former charter. And the allotted budget in the
previous operation of the PNR.
B. CONCLUSION
The role of railway systems in bringing growth and development to our lessdeveloped areas in far-flung provinces. It can-not be overemphasized that
railways directly contribute to economic growth as demand for transport is
directly and positively correlated to growth of gross domestic product. The
passage into Iaw ensures the continued operation of the cheapest form of
transportation for Filipinos. Compared to jeepneys and buses that charge P2
per kilometer, PNR

provides the cheapest mode of transportation to our people by charging only 71

centavos per kilometer. In congested nations with large urban populations like
in our country, the effort to match road capacity with exponential growth of
vehicular traffic will always be a challenge. Rail-ways use less land than the
mad sector, less polluting, and can generate high capacity at that.
The PNR is one of the modes of transportation in the Philippines. It has long
been built in the country and is still now being used and has been improved.
Routes are added and the stations and destinations were also developed.
C. RECOMMENDATION
PNR should consider to improve its operations and increase its
contribution to national economic development by: Conducting a full-blown
study for the overall PNR railway modernization plan, looking into the viability
of extending the existing PNR lines to routes that are possible sources of
increases ridership. Determining most advantageous or appropriate rail transit
technology for the PNR lines. Utilizing of improved ticketing, safety, and
security systems. Settling all its obligations to positively contribute to the
nation economy. Continuing efforts in venturing into other means of increasing

its revenues to help cover outstanding obligations. And lastly, better managing
its operation.
The Philippine National Railways should use the Cost-Benefit Analysis
Process. The Cost-Benefit Analysis is a process use in quantifying costs and
benefits of a decision, program, or project (over a certain period of time), and
those of its alternatives (within the same period), in order to have a single
scale comparison of unbiased evaluation. In cost benefit analysis decisions
are analyzed. The benefits of a given situation are summed and then cost
associated with taking that action are subtracted.